Time-barred VAT reassessment and audit objection material cannot by itself justify reopening a completed assessment.

VAT reassessment is described as time-barred where it is initiated after the three-year limit under Section 23 of the Himachal Pradesh Value Added Tax Act, 2005. The note further states that Section 24 extends limitation only in the specific situations it expressly covers, and that an audit objection or audit report alone does not constitute sufficient tangible material to reopen a completed assessment. It also records that the existence of an alternative appellate remedy does not prevent writ jurisdiction under Article 226 where the reassessment is alleged to be beyond limitation and unsupported by valid foundational material.

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Issues: Whether reassessment of VAT made after expiry of the statutory period of limitation and founded on audit objection could be sustained in writ jurisdiction despite the availability of an alternative appellate remedy.

Analysis: The reassessment was made in 2020 on the basis of an assessment originally completed on 19.01.2016, thus beyond the three-year limitation contemplated by Section 23 of the Himachal Pradesh Value Added Tax Act, 2005. Section 24 was held to extend limitation only in the circumstances expressly covered by that provision, and the audit-observation route did not satisfy that requirement. The reassessment order was also treated as lacking valid foundational material, since an audit objection or audit report, by itself, was not accepted as sufficient tangible material for reopening a completed assessment. In these circumstances, the alternative remedy was held not to bar the exercise of writ jurisdiction under Article 226.

Conclusion: The reassessment and consequential demand notice were held unsustainable, and writ relief was granted in favour of the assessee.

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